A prominent shareholder advisory firm has sided with Simpson Oil in its push for changes to the board of directors at Parkland Corporation.

Glass Lewis says the Calgary-based fuel retailer needs stronger independent oversight—but not a full overhaul.

In a recently published report, Glass Lewis recommended shareholders support seven of the nine board nominees put forward by Simpson Oil and six of the 13 candidates nominated by Parkland’s management, according to the Canadian Press.

“At initial glance, we were open to the view that less dramatic change might suffice, particularly given the extent of recent board refreshment and the fact that the company was beginning to act on some of the governance and strategic priorities raised by the dissident,” the firm wrote, according to CP.

“However, upon closer review, we believe the board’s record suggests a consistent pattern of reactive and defensive decision-making, with key changes occurring only after legal setbacks, public criticism or clear indications of an impending proxy contest.”

Glass Lewis said Parkland has “significantly underperformed” its industry peers and argued that the board would benefit from stronger independent oversight. However, it cautioned against replacing the board wholesale, noting that Parkland’s management has nominated experienced and qualified individuals.

Simpson Oil, which holds nearly 20% of Parkland shares, said in a press release that electing all nine of its nominees is the only way to ensure accountability, but it welcomed the advisory firm’s support.

The call for boardroom reform comes as Parkland prepares for its annual general meeting on May 6 while also conducting a strategic review. The company has been under pressure for more than a year from Simpson and fellow activist investor Engine Capital, who have criticized its governance and financial performance.

Both groups had urged Parkland to explore strategic alternatives to improve shareholder returns, including the possibility of selling the company. Parkland resisted until early April, when it announced a committee would be formed to examine potential deals.

Earlier this month, long-serving CEO Bob Espey announced plans to step down by year-end, a move that followed mounting pressure from the activist investors.

Simpson has characterized the announcement of his departure as an attempt to distract from the company’s mismanagement and trading losses, the most recent being a $55-million charge tied to its exit from California’s carbon- credit market.

Simpson claims that Espey’s resignation was not a proactive decision by Parkland’s board, but rather a move forced by legal disclosure obligations triggered by the trading loss.

In 2024, Simpson won a ruling from the Ontario Superior Court, freeing it from a 2019 governance agreement that had prevented it from engaging in activism or soliciting bids for the company.

As a result, Simpson called for Parkland to explore a sale.

The shareholder now argues that the only way to hold the current board accountable is through sweeping change.

Earlier this year, Parkland appointed two independent board members to appease Simpson, while reiterating an invitation for the company to rejoin the board.

Instead, Simpson is proposing the new slate of directors, including several with deep industry, investment, and governance experience.

Parkland operates about 4,000 gas stations and electric-vehicle charging sites across Canada, the U.S., and the Caribbean. The company also owns the On the Run convenience-store chain and M&M Food Market, along with a refinery in Burnaby, B.C.

Much of the company’s Caribbean network was acquired from Simpson when Parkland purchased the SOL refuelling-station chain in 2018 and 2022 for a combined $2.4 billion.

U.S.-based activist hedge fund Engine Capital has also called for a new Parkland board to oversee the review process.

Simpson announced that another leading advisory firm, International Shareholder Services, has joined it and Glass in calling for change.

Pictured: On the Run convenience store.

Photo: Parkland

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